Senator LUDWIG (Queensland—Minister for Agriculture, Fisheries and Forestry and Minister Assisting on Queensland Floods Recovery) (21:26):I thank the members who have contributed to the debate in the Senate, particularly members of the Senate Economics Legislation Committee, chaired by Senator Bishop, who delivered the report on the bill at the end of October. It is not something that you generally thank committees for in a summing-up speech, but I think that they made a significant contribution and added to the debate.

More broadly, and not unexpectedly, we have heard from the opposition nothing but a series of false and misleading claims as part of their ongoing scare campaign. One would have thought that by now they would be running out of puff in their scare campaign but, no, they continue to harp on with their scare campaign. One of the key claims we have heard repeated here tonight is that the world is not acting, which we have heard before. It is a broken record and one would think that they would play a new tune. Countries in our region are not acting and Australia is going it alone is the refrain that they use, along with the one that we are the only emissions trading scheme in the world.

How far from the truth can that possibly be? The reality is that, by next year, around 1.1 billion people will be living in a jurisdiction with a carbon price. Since we introduced the carbon price last year, more and more countries around the world are saying that they too are moving to put a price on carbon, just like Australia. It is reinforced that South Africa, China, Korea, Japan will, and the list goes on. The eighth biggest economy in the world, which is California, has already held its first auction and, by 2015, the scheme will be the third largest in the world, covering 85 per cent of emissions—an extraordinary achievement. This is on top of the carbon price schemes already operating or being developed in nine US states and four Canadian provinces, covering nearly 90 million people. Next year, our biggest trading partner, China, will launch its regional emissions trading scheme. It will cover over 200 million people and over 2,000 Chinese businesses. All of these developments come after the European Union and New Zealand introduced emissions trading schemes, not last year or the year before but in 2005 and 2008 respectively.

We are acting with the world. We are not ahead of it; we are not behind it; we are doing our fair share to reduce emissions. That is an important statement to dwell on for a moment. It is action that we are taking in the best possible way—that is, introducing a price on carbon with a fixed period followed by an emissions-trading scheme because the markets will operate most effectively to reduce our carbon emissions.

I am taking some time with this summing up speech to debunk some of the misleading and false assertions by the opposition, because they think if they say it over and over again it must be true. Well the more they say it the further from the truth it is becoming. It is no longer credible for the opposition to say that we should not act. The world is acting and the community, by and large, expect us to act and we are acting. We are acting with the world and already you can look at our record. Two weeks ago the IMF reported on our economy and commended our well-designed carbon price. Last Monday, the International Energy Agency delivered an in-depth review of Australia's energy and climate policy, welcoming the carbon price and Clean Energy Future plan.

I want to deal with the coalition claim that the EU will set the price and that this is an abrogation of sovereignty to the EU. The coalition do not seem be rationally debating arguments; they seem very close to arguments that only people on the outer fringe of these debates—extremists—would come up with. Quite frankly, it is surprising that they would hold it. Linking to international carbon markets, including the EU, allows market forces to set the carbon price. Trade in carbon is no different to trade in any other commodity we will import or export. We cannot set the global price for coal or oil. These prices are set on the international market. Similarly, global carbon prices are set by the international market and the legislative and economic decisions from all countries that trade in carbon will influence those prices. The important thing is that the linking arrangement now allows us to be part of that broader global carbon market, which will only grow larger into the future.

Again, the coalition are fundamentally at odds with the views of the business community about these amendments. Again, the opposition put themselves on the fringe, away from what would be, I would have thought, their natural constituents. Far be it from me to say it, but it might be a view where they feel quite comfortable to be on the fringe and that far away from their business community links. If that is the case, then business understand the imperative of setting a price on carbon, driving for a low carbon future, ensuring that we have a clean energy future and participating in markets dealing with carbon. Business understand these changes will deliver benefits for Australian industry and for the environment. They respond to calls from peak business and industry groups not to have a floor price when we move to an ETS and to provide access to the largest carbon market in the world.

That is why business groups and companies like the Energy Supply Association, TruEnergy and Virgin came out in support of this announcement. The coalition claim that these changes are bad for the Carbon Farming Initiative. When key carbon farming participants like CO2 Group and Greenfleet strongly support these changes, it is extraordinary that those opposite put themselves on the fringe again. Be that as it may, I guess when you are wedded to a negative argument you cannot find room to move.

This is another one of those myths that those opposite peddle. This is the emissions-trading scheme design the Howard government proposed and now they reject it for politics over policy. Again, if you look at the history of this, it was in 2001 that we started talking about this. It was under the Howard government that ABARES did work in this area, very important work, about how to develop an ETS and design a system. With an agreement to link a fully flexible emissions-trading scheme from 2015, this is in fact the very same policy the coalition took to the election in 2007. I suspect some in the opposition would have many statements of support for an emissions-trading scheme, and yet what we find now is a complete policy backflip. Bold-faced? Be that as it may, clearly the community recognise that it is a policy backflip from those opposite.

In conclusion, if you look at the really short issue—that is, Australia's carbon price is part of a global action to tackle climate change—it is a very simple proposition. We are participating in and playing our bit in the global action to tackle climate change. This bill represents an important step towards establishing a common carbon price internationally. This will ensure Australia's industry is competitive as the world reduces emissions. By contrast, the Leader of the Opposition would do nothing to tackle climate change, thereby increasing the cost to business by barring links to international carbon markets and exposing Australia to trade retaliation from countries reducing their emissions. The fact is that the carbon price has been in place nearly five months and contrary to all the bogus claims by the Leader of the Opposition, unemployment is low, inflation is low, the economy is outperforming every other developed economy and investment is at record levels. Bit by bit the claims the coalition made in their hollow scare campaign are shown up for what they are.

I cannot understand why they are not embarrassed but maybe they have more gall than I. By this time I would be trying to slip out the back door on this issue but those opposite remain steadfast. Can I say I take my hat off to someone who in the face of that remains so steadfast.

This government is going to do its fair share to protect against the dangerous impacts of climate change. This bill is part of that action. It is economically and socially responsible. It will ensure that emissions are reduced at the lowest cost and that our economy can transition to a clean energy future. Can I again thank all of those who participated in this debate and commend the bill to the Senate.

The PRESIDENT: The question is that these bills be now read a second time.